Corporate Finance - Ethical Systems

INTRODUCTION

Corporate finance studies the financing, investment, risk management, and disclosure decisions of firms, how organizational structure and the incentive systems of managers impinge upon these decisions, and corporate governance. These issues often involve agency problems owing to the need to motivate managers or other employees to take actions on behalf of owners, and information problems as the firm often possesses information about investment opportunities that outside providers of capital do not have. Corporate financial decisions often impose costs and confer benefits on different parties, creating conflicts of interest which raise ethical issues. To mention just a few examples, terminating an investment project may cause unemployment; undertaking an investment may cause pollution; taking large risks can impose costs on creditors; and issuing securities when the firm has adverse information about their value can expropriate purchasers.

CONTENTS

IDEAS TO APPLY (Based on research covered below)

AREAS OF RESEARCH

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CASE STUDIES

Failures

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